WazirX's Bold Bid: 85% Refund for Hack Victims

WazirX, the once-thriving Indian cryptocurrency exchange, has concluded its rebalancing process and introduced a refund plan for victims of previous hacks. The exchange, which was once a major player in the Indian cryptocurrency market, has faced significant challenges in recent years, including a major hack in July 2024 and regulatory scrutiny.

The refund plan, outlined in a blog post, offers victims 85% of their portfolio value if the majority approves the proposal. This solution aims to help creditors, who have until February 19 to decide whether to accept the current rebalancing plan. The first round of payments is set for April, providing hope to those affected by the hack. Creditors can quickly check their share through the WazirX app or website.

As part of the recovery plan, WazirX has outlined strategies to help restore value to creditors. These include launching a Decentralized Exchange (DEX) and creating recovery tokens. WazirX will also use profits and new revenue to buy back these tokens over the next three years periodically. The recovery tokens will also be tradable, enabling users to recover some of their losses.

However, the entire plan depends on the approval of most creditors. If they don’t, the restructuring plan will fail, and the company will have to go into liquidation under section 301 of the Singapore Companies Act. In that case, WazirX might have to stop operating, and creditors will have few options for returning their money.

In January, the Singapore High Court approved the exchange’s restructuring plan, enabling the repayment of customer funds stolen in the July 2024 breach. The attack, attributed to North Korea’s notorious Lazarus Group, left users and the platform grappling with significant losses. The restructuring plan, filed by WazirX’s parent company, Zettai, under Singapore’s Companies Act 1967, aims to prioritize creditor recovery while avoiding liquidation.

Notably, the court found no evidence of misconduct or negligence on WazirX’s part in the cyberattack. The conclusion aligned with a joint statement from the United States government, Japan, and South Korea, which linked the breach to the Lazarus Group.

WazirX’s efforts come as it faces heightened scrutiny from regulators. Additionally